ISIN: JP3218900003 SEDOL: 6173694 JP...ISIN: JP3218900003 SEDOL: 6173694 JP May 26, 2020 To: Shareholders Notice of Convocation of the 41st Ordinary General Meeting of Shareholders

1

Translation: Please note that the following purports to be an accurate and complete translation

of the original Japanese version prepared for the convenience of investors. However, in the

case of any discrepancy between the translation and the Japanese original, the latter shall

prevail.

TSE Code: 9697

ISIN: JP3218900003

SEDOL: 6173694 JP

May 26, 2020

To: Shareholders

Notice of Convocation of the 41st Ordinary General Meeting of Shareholders

We would like to hereby inform you that the 41st Ordinary General Meeting of

Shareholders of the Company will be held as described below.

We would like to express our deepest compassion for the people and regions suffering

from COVID-19. We extend our genuine condolences to those closest to the victims who lost

their lives, and sincerely wish the people under severe treatment for the disease an early

recovery.

As for exercising your voting rights to our proposals as described below, it is possible

to exercise your voting rights by either the methods stated below. To exercise voting rights,

please review the Reference Document Concerning the General Meeting of Shareholders below

and exercise your rights by 5:30 PM on June 16, 2020 (Tuesday), JST.

[In case of exercising voting rights by mail]

Please indicate on the Voting Right Exercise Form enclosed herewith your approval or

disapproval of each proposal listed thereon and return the form to the Company before the

deadline stated above.

[In case of exercising voting rights via the Internet]

Note: Voting via the Internet other than ICJ platform is only available for registered

shareholders in Japan with Japanese language only. The ICJ platform is an electronic voting

platform for institutional investors via ProxyEdge® system of Broadridge. For further details,

please consult with your custodian(s), nominee(s) and/or broker(s).

Exercising a voting right can only be made by accessing the website of Mitsubishi UFJ Trust

and Banking Corporation, the administrator of shareholders’ register

( https://evote.tr.mufg.jp/ ). Please use the log-in ID and temporary password which are

shown on the Voting Right Exercise Form. After logging in, please indicate your approval

or disapproval of each proposal by following the instructions on the display screen before the

deadline stated above.

Please see the Guidance for the Exercise of Voting Rights via the Internet attached below

(p.*-p.* note: intentionally omitted).

2

The Company has participated in the electronic voting right execution platform for

institutional investors operated by ICJ, Inc.

In case that a voting right is exercised both by the Voting Right Exercise Form and via the

Internet, only the vote registered via the Internet will be recognized as valid.

(Note)

Your vote is important. We will appreciate your participation in the Meeting through

providing instruction to your custodian(s), broker(s), nominee(s), voting agent(s) or other

authorized intermediaries to process your vote as soon as possible. We look forward to

receiving your vote.

Yours faithfully,

CAPCOM Co., Ltd.

1-3, Uchihirano-machi 3-chome,Chuo-ku,

Osaka, Japan

By: Haruhiro Tsujimoto

President and COO

Representative Director

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Particulars

1. Date & Time: June17, 2020 (Wednesday) at 10:00 a.m.

(Reception is scheduled to open at 9:00 a.m.)

2. Place: Osaka Castle Hotel, 6F Hall

1-1, Tenmabashikyomachi Chuo-ku, Osaka

3. Agenda:

Matters to be reported:

1 Report on the Business Report, Consolidated Financial Statements and

Non-Consolidated Financial Statements for the 41st Fiscal Year (from April 1,

2019 to March 31, 2020); and

2 Report on the Results of Audit for Consolidated Financial Statements for the

41st Fiscal Year (from April 1, 2019 to March 31, 2020) by Accounting

Auditor and the Audit and Supervisory Committee.

Matters to be resolved:

First proposal: Proposed Appropriation of Retained Earnings

Second proposal: Election of Seven (7) Directors (excluding Directors who are

members of the Audit and Supervisory Committee)

Third proposal: Election of Three (3) Directors who are members of the Audit

and Supervisory Committee

Forth proposal: Election of One Director who is a substitute member of the

Audit and Supervisory Committee

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◎ Countermeasure to secure safety in light of COVID-19

Your due consideration to exercise the voting right is sincerely requested to avoid infection

by physically attending to the Ordinary General Meeting of Shareholders as the case may be,

although every precautious measures and devices are to be provided with our utmost efforts

on the site of the Meeting by the Company.

When you actually decide to attend to the Meeting in person, please wear your own mask

and put some hand sanitizer on your hand and rub it in well before entering to the Meeting

site.

◎ Introduction of Hybrid Participation-Type General Meeting of Shareholders

We would like to introduce so-called the hybrid participation-type general meeting of

shareholders since this year in line with current regulatory guidance, although exercising

voting rights to our proposals remains unchanged as described in Notice of Convocation of

41st Ordinary General Meeting of Shareholders.

The shareholders will be able to virtually participate into the general meeting through video

streaming services while sending comments on the meeting (note: This service is only

available in Japanese language)

◎ When you attend the Meeting in person, please submit the Voting Right Exercise Form enclosed

herewith to the receptionist at the place of the Meeting.

◎ For saving natural resources, please take this notice of convocation with you to the Meeting.

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Reference Document Concerning the General Meeting of Shareholders

Proposals and reference matters:

First proposal: Proposed Appropriation of Retained Earnings

The Company considers returning profits to the shareholders to be one of the most

important management issues. The Company, taking into account the future business

development and changes in operating circumstances, makes best efforts to pay stable and

continued dividends on the basis of fundamental policy under which consolidated payout ratio is

30%.

The Company, taking into account the policy set forth above, and with net income

attributable to owners of the parent having renewed a record high, proposes to distribute ¥25 per

share, as the year-end dividend for the fiscal year under review, an increase in ¥5 per share from

previous fiscal year end as follows:

1. Type of dividend property: Cash

2. Matters concerning the allotment of dividend property and the total amount paid to

shareholders:

¥25 per share of common stock of the Company; the total amount to be ¥2,668,765,350

Note: For interim dividend the Company paid ¥20 per share, thus the annual dividend for

the fiscal year under review is ¥45 per share and the consolidated payout ratio is 30.1%.

3. Date when dividends of retained earnings take effect: June 18, 2020(Thursday)

Note: A stock split took place as at April 1st, 2018, whereby one ordinary share was split

into two shares.

（¥-million）（％）

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Second proposal: Election of Seven (7) Directors (excluding Directors who are members of the Audit and Supervisory Committee)

Mr. Kunio Neo, the Director of the Company resigned from his office as at March 31st,

2020. The term of office for the other seven (7) Directors (excluding Directors who are

members of the Audit and Supervisory Committee) shall expire at the closing of this Ordinary

General Meeting of Shareholders.

Therefore, the Company proposes to elect seven (7) Directors to stream management

efficiency.

For the purpose of selecting Candidates for Directors, the Nomination and Remuneration

Committee, the majority of which consists of Independent Directors and of which the Chairman

is an Independent External Director so as to enhance transparency and objectivity, was referred

to and the Board of Directors decided Candidates for Directors upon consideration of the

recommendation of the Nomination and Remuneration Committee.

Furthermore, it was reported that the Audit and Supervisory Committee expressed its

opinion that this proposal is appropriate upon deliberation.

Candidates for Directors are as follows:

Candidate

No. Name

Career position and assignment

in the Company

Term of

office as a

Director*

Attendance of

the Board of

Directors

meetings

Number of

positions at

other listed

companies

1 Kenzo Tsujimoto

Internal Re-election

Chairman and Representative Director

Chief Executive Officer (CEO) 37 years

9/10 times

(90%) －

2 Haruhiro Tsujimoto


Representative Director

President and Chief Operating Officer

(COO), in charge of Sales Operations

Business and Arcade Operations

Business

23 years 10/10 times

(100%) －

3 Yoichi Egawa


Director

Executive Corporate Officer, in charge

of Development Divisions and

Pachinko & Pachislo Business

Divisions

7 years 10/10 times

(100%) －

4 Kenkichi Nomura


Director

Executive Corporate Officer, Chief

Financial Officer (CFO) in charge of

Corporate Management, Planning and

Strategy Divisions

4 years 10/10 times

(100%) －

5

Masao Sato

External Re-election

Independent Director

Director 4 years 10/10 times

(100%) －

6

Toru Muranaka



Director 4 years 10/10 times

(100%) 2 companies

7

7

Yutaka Mizukoshi



Director 2 year 10/10 times

(100%) 2 companies

*The term of office as Director represents the period from assumption at the closing of this General

Meeting of Shareholders.

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For your reference:

【Criteria of Independence of External Director】

The Company established judgment criteria of independence of External Director by which

the Company makes judgment that he/she should be independent External Director if he/she

does not fall under any of the following events:

(i) A business executer of the Company group (“the Company and its consolidated

subsidiaries” and the same applicable hereinafter) currently or in the past ten (10) years;

(ii) A main business partner or a business executer of such business partner (enterprise and

the like), “main” meaning that consolidated net sales or trading value between the

Company group and the business partner accounts for not less than one (1) % of the

Company group and the business partner (as the case may be) on an annual basis;

(iii) A person or enterprise having main business relationship with the Company group or a

business executer of such enterprise, “main” meaning that consolidated net sales or

trading value between the Company group and such enterprise accounts for not less than

one (1) % of the Company group and such enterprise (as the case may be) on an annual

basis;

(iv) The principle shareholders of the Company (holding not less than 10% of the total voting

rights) or a business executer of such shareholder or corporation of which the Company

group is principle shareholder;

(v) A business executer of organization or corporation to which the Company group donated,

financed or guaranteed in a large amount;

(vi) A business executer of corporation with which the Company group has cross directorship;

(vii) Lawyer, certified public accountant, consultant and the like who received ¥10 million or

more in cash or assets per annum (in case of corporation or association who receives such

assets, person belonging to such corporation or association that an amount involved in

transactions between the Company group accounts for not less than one (1) % of the

consolidated net sales or trading value of the Company group (as the case may be) on an

annual basis) and ¥10 million or more.

(viii) In case of (ii) to (vii) above, person falling under any of business year in the past five (5)

years; and

(ix) Spouse or relative within the second degree of kinship of the person falling under any of

(i) to (viii) above.

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Candi

-date

No.

Name

(Date of birth, Term of office as

Director, Attendance of the Board

of Directors meetings, Number of

shares of the Company held)

Resume, position, responsibility, important concurrent office

of other organizations

1 Kenzo Tsujimoto


Date of birth: December

15, 1940

Term of office as Director: 37

years

(At the closing of this Ordinary

General Meeting of

Shareholders)

Attendance of the Board of Directors meetings: 9/10

times (90%)

Number of shares of the

Company held: 4,019,580

shares

July 1985: President and Representative Director of the

Company Apr. 1997: Head of The Association of Copyright for

Computer Software (Currently The General Incorporated Association of Copyright for Computer Software) (to present)

Apr. 2001: Chief Executive Officer (CEO) of the Company (to present)

July 2007: Chairman and Representative Director of the Company (to present)

Feb. 2010: Representative Director of Kenzo Estate Winery Japan Co., Ltd. (to present)

[Important concurrent office of other organizations] Representative Director of Kenzo Estate Winery Japan Co., Ltd. Head of The General Incorporated Association of Copyright for Computer Software

【Reasons for nomination】

Mr. Kenzo Tsujimoto has promoted the Company with his strong leadership as a top of

management, in addition to exceeded ability to grasp future development and abundant

experiences, by virtue of his power for swift determination and execution. His existence as a

charismatic founder of the Company is mental pole as well as centripetal force of the

Company’s officers, and employees.

Taking into consideration the results of the Company until today, the Company continues to ask

shareholders to elect him as Director since the Company could expect him to contribute to the

enhancement of the corporate value of the Company hereafter.

【Special Interests between the candidate and the Company】

He is concurrently the representative director of Kenzo Estate Winery Japan Co., Ltd., with which

the Company has a trading relationship including purchase of its products, etc.

10

Candi

-date

No.

Name







2 Haruhiro Tsujimoto


Date of birth: October 19, 1964


years


General Meeting of

Shareholders)


times (100%)


Company held: 3,099,300

shares

Apr. 1987: Entered into the Company June 1997: Director of the Company Feb. 1999: Managing Director of the Company Apr. 2001: Senior Managing Director of the Company July 2004: Director and Executive Corporate Officer of the

Company Apr. 2006: Director and Executive Vice President of the

Company July 2007: President and Representative Director, Chief

Operating Officer (COO) of the Company (to present)

Aug. 2016: President and Representative Director, and Director in charge of Global Marketing Business and Arcade Operations Business of the Company

June 2018: President and Representative Director, and Director in charge of Arcade Operations Business of the Company

Apr. 2020: President and Representative Director, and Director in charge of Sales Operations Business and Arcade Operations Business of the Company (to present)


Mr. Haruhiro Tsujimoto has, since assumption of the office of President, been engaged in deep

plowing of the existing business and diversifying business fields such as strengthening software

development, the core business of the Company, promoting one contents multi-use development

and eSports business. He contributed to strengthening steadily management base by agile

management suited for environment changes and steady management method.

The Company continues to ask shareholders to elect him as Director since the Company could

expect him to contribute to the development of the Company hereafter.


There is no special interest relationship between Mr. Tsujimoto and the Company.

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Mr. Youichi Egawa has, since his entrance into the Company, been engaged in development,

manufacture, sales and operation of amusement facilities for many years so that he owns high

profession, abundant experiences and know-how. He is fully acquainted with a wide range of

knowledge and practice with respect to overall games and it is expected for him to contribute to

expansion of the Company’s overall business hereafter so that the Company asks shareholders

to continue to elect him as Director.

【Special interests between the candidate and the Company】

There is no special interested relationship between Mr. Egawa and the Company.

Candi

-date

No.

Name





Resume, position, responsibility, important concurrent

office of other organizations

3 Yoichi Egawa


Date of birth: November 15,

1963


years


General Meeting of

Shareholders)

Attendance of the Board of Directors meetings: 10/10 times

(100%)


Company held: 3,900 shares

Apr. 1985: Entered into the Company Apr. 1999: General Manager of Creative Division

5 of the Company Aug. 1999: Corporate Officer, General Manager of

Creative Division 5 of the Company Apr. 2011: Managing Corporate Officer of the

Company Apr. 2013: Executive Corporate Officer of the

Company (to present) June 2013: Director, in charge of Arcade Business and

Pachinko & Pachislo Business of the Company

July 2016: Director, in charge of Amusement Equipment Business, Arcade Operations Business and Consumer Games Development of the Company

Apr. 2019: Director, in charge of Consumer Games Development and Pachinko & Pachislo Business Divisions of the Company

Apr.2020: Director, in charge of Development Divisions and Pachinko & Pachislo Business Divisions of the Company (to present)

12

Candi

-date

No.

Name







4 Kenkichi Nomura


Date of birth: May 18, 1955


years


General Meeting of

Shareholders)


times (100%)



Apr. 2009: Corporate Officer in charge of Internal Control

of the Company July 2010: Managing Corporate Officer in charge of

Financial and Accounting Division of the Company

Jun. 2015: Managing Corporate Officer in charge of Financial and Accounting Division and Secretarial Affairs, PR and IR Division of the Company

Apr. 2016: Executive Corporate Officer (to present) Head of Finance, Accounting and Public Relations Divisions

June 2016: Director, Chief Financial Officer (CFO) (to

present) and in charge of Corporate Management

of the Company

Apr. 2020: Director, in charge of Corporate Management,

Planning and Strategy Divisions of the Company

(to present)


Mr. Kenkichi Nomura has expertise on a wide range of business fields including finance,

accounting, IR and public relations and the like so that Mr. Nomura oversees overall

management and duly discharges his duties. The Company asks shareholders to continue to

elect him as Director since he is expected to hereafter contribute to development of the

Company.


There is no special interested relationship between Mr. Nomura and the Company.

13

Candi

-date

No.

Name







5 Masao Sato



Date of birth: Feb 25, 1951


years


General Meeting of

Shareholders)


times (100%)


Company held: 700 shares

Apr. 1975: Entered into the National Police Agency Nov. 1995: Chief of Ehime Prefectural Police Headquarters Jan. 2001: Chief of Miyagi Prefectural Police Headquarters Aug. 2005: Chief of Chiba Prefectural Police Headquarters Jan. 2007: Director General of Kanto Regional Police

Bureau Mar. 2008: Resigned from the National Police Agency June 2008: External Corporate Auditor of the Chugoku

Electric Power Co., Inc. June 2016: External Director of the Company (to present) June 2017: Director, Public Interest Corporation, Furuoka

Scholarship Foundation (to present)


Mr. Masao Sato has no direct management experiences for private companies other than acting

as an External Director or an External member of Corporate Auditors, but he had been engaged

in administration of the National Police Agency for many years so that he is acquainted with a

wide range of professional knowledges and abundant experiences on overall laws, and he makes

presentations from the standpoint of neutral and objective views.

Since it is expected that he will contribute to strengthen audit and supervision of the Board of

Directors from the viewpoint of risk management and securing legitimacy, the Company asks

shareholders to continue to elect him as External Director.


There is no special interested relationship between Mr. Sato and the Company.

【Independence】

The Company filed him to the Tokyo Stock Exchange, Inc., as an independent director so

defined therein. In the event that he is re-elected, the Company plans to continue filing him to

the Tokyo Stock Exchange, Inc., to be an independent director.

For Criteria of Independence of External Director, please refer to P.8

14

【Liability limit agreement】

The Company has entered into a liability limit agreement pursuant to Article 427, Paragraph 1

of the Companies Act, limiting compensation liability for damages provided for in Article 423,

Paragraph 1 of the Companies Act. The limit of compensation liability for damages under the

aforesaid agreement is the minimum amount provided for in the laws and ordinances. When he

is re-elected, the Company is scheduled to continue the subject liability limit agreement.

15

Candi

-date

No.

Name







6 Toru Muranaka



Date of birth: June 3, 1965


years


General Meeting of

Shareholders)

Attendance of the Board of Directors meetings: 10/10times

(100%)



Apr. 1995: Registered Lawyer (Osaka Bar Association)

Entered into Daiichi Law Office (Currently Daiichi Law Office, P.C.)

Dec. 2007: Partner of Daiichi Law Office, P.C. (to present) May 2014: External Corporate Auditor of Furuno Electric

Co., Ltd. (to present) Jun. 2015: External Corporate Auditor of Suzuken Co., Ltd.

(to present) June 2016: External Director of the Company (to present) [Important concurrent office of other organizations] Partner of Daiichi Law Office, P.C. External Corporate Auditor of Furuno Electric Co., Ltd. External Corporate Auditor of Suzuken Co., Ltd.


Mr. Toru Muranaka has not participated in management of companies other than in the way as

an External Director or an External Corporate Auditor. He is a lawyer specialized in the field of

the Companies Act, Financial Instruments and Exchange Act and others, and in addition to

holding a high level of professional knowledge and wide ranging insight and expertise, he

makes suggestions and gives advice to the Company on legitimacy and appropriateness from a

professional viewpoint.

It is expected that he will contribute to strengthen audit and supervision of the Board of

Directors from the legal viewpoint. Accordingly, the Company asks shareholders to elect him as

External Director.

Furthermore, he is a member of Legal Professional Corporation (LPC) Daiichi Law Office, P.C.

with which the Company has entered into legal counsel agreement. Since the total amount

involved in transactions between the two parties on an annual basis accounts for less than one

(1) % of consolidated net sales of the Company and the P.C. and less than ¥10 million, the

Company made judgment that such agreement does not affect the independence of External

Director as he meets the criteria laid down by the Company.


There is no special interested relationship between Mr. Muranaka and the Company.

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【Independence】




For Criteria of Independence of External Director, please refer to P.8.







17

Candi

-date

No.

Name







7 Yutaka Mizukoshi



Date of birth: August 29, 1956


years


General Meeting of

Shareholders)


times (100%)



Apr. 1980: Entered into Nippon Steel Corporation May 2004: Senior Vice President of The Boston Consulting

Group Jan. 2005: Japan Co-chair of The Boston Consulting Group Jan. 2016: Senior Partner and Managing Director of The

Boston Consulting Group June 2016: External Director of Lifenet Insurance Company

(to present) External Director of Asagami Corporation (to present)

Jan. 2018: Senior Advisor of The Boston Consulting Group, Tokyo (to present)

June 2018: External Director of the Company (to present) June 2019: Director, Japan Rugby Football Union (to

present) [Important concurrent office of other organizations] Senior Advisor of The Boston Consulting Group, Tokyo External Director of Lifenet Insurance Company External Director of Asagami Corporation


In addition to possessing expertise in management analysis and the formulation of management

strategy, acquired through years of experience in, and insights from, the consultancy industry,

Mr. Yutaka Mizukoshi proactively provides opinions and proposals from an independent

standpoint, based on a high level of insight and a developed international sensibility.

Going forward, it is expected that he will contribute to stronger audit and supervision of the

Board of Directors from an outside viewpoint. Accordingly, the Company asks shareholders to

re-elect him as External Director.


There is no special interested relationship between Mr. Mizukoshi and the Company.

【Independence】







18





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Third proposal: Election of Three (3) Directors who are members of the Audit and

Supervisory Committee

The term of office for all three (3) Directors who are members of the Audit and

Supervisory Committee shall expire at the closing of this Ordinary General Meeting of

Shareholders.

Therefore, the Company proposes to elect three (3) Directors who are members of the

Audit and Supervisory Committee.

For the purpose of selecting Candidates for Directors who are members of the Audit

and Supervisory Committee, the Nomination and Remuneration Committee, majority of which

consists of Independent Directors and of which the Chairman is an Independent External

Director so as to enhance transparency and objectivity, was referred to and the Board of

Directors decided Candidates for Directors upon consideration of the recommendation of the

Nomination and Remuneration Committee.

The Audit and Supervisory Committee has given consent to this proposal.

Candidates for Directors who are members of the Audit and Supervisory Committee

are as follows:

Candidate

No. Name

Career position and

assignment

in the Company

Term of

office as

a

Director1

Attendance

of the Board

of

Directors

meetings

Attendance

of the Audit

and

Supervisory

Committee

meeting

Number of

positions at

other listed

companies

1 Kazushi Hirao


Director (Full-time member

of the Audit and Supervisory

Committee)

4 years 9/10 times

(90%)

9/10 times

(90%) －

2

Yoshihiko Iwasaki



Director (Full-time member

of the Audit and Supervisory

Committee)

4 years 10/10 times

(100%)

10/10times

(100%) －

3

Makoto Matsuo



Director (Member of the

Audit and Supervisory

Committee)

13years 10/10 times

(100%)

10/10 times

(100%) 3 companies

Notes：

1. The term of office as Director represents the period from assumption at the closing of this General

Meeting of Shareholders.

2. Mr. Yoshihiko Iwasaki was an External Corporate Auditor for four (4) years before being elected as an

External Director who is a member of the Audit and Supervisory Committee.

20

3. Mr. Makoto Matsuo was an External Director for nine (9) years before being elected as an External

Director who is a member of the Audit and Supervisory Committee. He has been an External Director

who is a member of the Audit and Supervisory committee for four (4) years.

21

Candi

-date

No.

Name



of Directors meetings,

Attendance of the Audit and

Supervisory Committee meeting,

Number of shares of

the Company held)



1 Kazushi Hirao


Date of birth: September 25,

1951


years


General Meeting of

Shareholders)

Attendance of the Board of Directors meetings: 9/10 times

(90%)



meeting: 9/10 times (90%)



June 1988: Entered into the Company Apr. 1997: General Manager of Overseas Business Dept. of

the Company July 1999: Corporate Officer, General Manager of Overseas

Business Dept. of the Company Oct. 2002: General Manager of General Affairs Dept. of the

Company Apr. 2004: Senior Manager of Investor Relations Section of

the Company June 2004: Corporate Auditor of the Company (full-time) June 2016: Director (Full-time member of the Audit and

Supervisory Committee) of the Company (to present)


Mr. Kazushi Hirao has been enriched with international sense based on experience of

engagement in overseas affiliates for a long period as well as having affluent experiences on

treasury and accounting, and has audited the Company and domestic and overseas subsidiaries

of the Company from the global viewpoints.

As it is expected that he will hereafter contribute to strengthen audit and supervision of the

Board of Directors based on professional knowledges and experiences cultivated through

activities as Corporate Auditor and Director who is a member of the Audit and Supervisory

Committee. Accordingly the Company asks shareholders to re-elect him as a member of the

Audit and Supervisory Committee.


There is no special interested relationship between Mr. Hirao and the Company.

22

【Liability Limit Agreement】






23

Candi

-date

No.

Name






Number of shares of

the Company held)



2 Yoshihiko Iwasaki





years


General Meeting of

Shareholders)


times (100%)






Apr. 1979: Entered into National Tax Agency July 1986: District Director of Ijuin Tax Office July 1999: Deputy Commissioner (Large Enterprise

Examination and Criminal Investigation) of Hiroshima Regional Taxation Bureau

July 2007: Assistant Regional Commissioner (Management and Co-ordination) of Nagoya Regional Taxation Bureau

July 2009: Director-General of Kanazawa Regional Tax Tribunal

July 2010: Director-General of Sapporo Regional Tax Tribunal

July 2011: Vice President of National Tax College June 2012: External Corporate Auditor of the Company

(full-time) June 2016: External Director (Full-time member of the

Audit and Supervisory Committee) of the Company (to present)


Though Mr. Yoshihiko Iwasaki has no direct management experiences for the private

companies other than acting as an External Director and External Corporate Auditor, he holds

knowledge on finance and accounting in addition to professional knowledge and abundant

experience on tax administration, he delivers advice and assistance from the viewpoint of

external officer to the extent of External Corporate Auditor’s duties.

In the light of tax matters, finance and accounting, as it is expected that he will contribute to

strengthen audit and supervision of the Board of Directors, the Company asks shareholders to

re-elect him as External Director who is a member of the Audit and Supervisory Committee.


There is no special interested relationship between Mr. Iwasaki and the Company.

24

【Independence】











25

Candi

-date

No.

Name






Number of shares of

the Company held)



3 Makoto Matsuo





years


General Meeting of

Shareholders)


times (100%)






Apr. 1975: Admitted to Japanese Bar (The Dai-ichi Tokyo

Bar Association) Ozaki & Momo-o Aug. 1978: Weil, Gotshal & Manges in New York Mar. 1979: Admitted to New York Bar Apr. 1989: Partner of Momo-o, Matsuo & Namba (to

present) Apr. 1997: Lecturer of Nihon University, Faculty of Law:

International Transaction Law Apr. 2005: Lecturer of Hitotsubashi University Faculty and

Graduate School of Law: World Business Law June 2007: External Director of the Company Mar. 2014: External Corporate Auditor of Solasia Pharma

K.K. (to present) June 2016: External Director (Member of the Audit and

Supervisory Committee) of the Company (to present)

June 2018: Outside Statutory Auditor of Sumitomo Forestry Co., Ltd (to present)

Apr. 2020: Temporary Outside Audit & Supervisory Board Member of Taisho Pharmaceutical Holdings Co., Ltd. designated by Tokyo District Court (to present)

[Important concurrent office of other organizations] Partner of Momo-o, Matsuo & Namba External Corporate Auditor of Solasia Pharma K.K. Outside Statutory Auditor of Sumitomo Forestry Co., Ltd. Temporary Outside Audit & Supervisory Board Member of Taisho Pharmaceutical Holdings Co., Ltd.


Although Mr. Makoto Matsuo has no direct management experiences for the private companies

other than acting as External Directors and/or External Corporate Auditors, he actively engages

in the legal community based on a high level of professional knowledges and a wide range of

insight and thought as a lawyer as well as is acquainted with the business world through

abundant experience accumulated by a lot of career as external officer of many number of listed

companies, he delivers guidance and advices from legal and other viewpoints at the Board of

Directors and the like.

Therefore, the Company asks shareholders to elect him as External Director who is a member of

the Audit and Supervisory Committee.

Furthermore, he is a partner lawyer of Momo-o, Matsuo & Namba with which the Company has

entered into legal counsel agreement. Since the total amount involved in transactions between

the two parties on an annual basis accounts for less than one (1) % of consolidated net sales of

26

the Company and less than ¥10 million, the Company made judgment that such agreement does

not affect the independence of External Director as he meets to the criteria laid down by the

Criteria of Independence of External Director.


There is no special interested relationship between Mr. Matsuo and the Company.

【Independence】











27

(For your reference)

1. If 2nd and 3rd proposals are approved in their current form, five (5) directors out of ten (10)

shall be external directors in total.

All of the five external directors shall be filed to the Tokyo Stock Exchange as the

Independent Directors.

2. At the meetings of Board of Directors and/or Audit and Supervisory Committee after this

Ordinary General Meeting of Shareholders, following committee members shall be elected

and approved.

(1) Audit and Supervisory Committee

Makoto Matsuo (Chairman, Audit & Supervisory Committee member, External Director)

Kazushi Hirao (Full-time Audit & Supervisory Committee member, Internal Director)

Yoshihiko Iwasaki (Full-time Audit & Supervisory Committee member, External Director)

(2) Nomination and Remuneration Committee

Yoshihiko Iwasaki (Chairman, Full-time Audit & Supervisory Committee member, External

Director)

Kenkichi Nomura (Internal Director)

Yutaka Mizukoshi (External Director)

Kazushi Hirao (Full-time Audit & Supervisory Committee member, Internal Director)

Makoto Matsuo (Audit & Supervisory Committee member, External Director)

28

Fourth proposal: Election of One (1) Substitute Director who shall be a member of

the Audit and Supervisory Committee

At the 39th Ordinary General Meeting of Shareholders held on June 11th, 2018, Mr.

Hitoshi Kanamori was elected as a Substitute Director who shall be a member of the Audit and

Supervisory Committee and its effectiveness shall be expired before the commencement of this

Ordinary General Meeting of Shareholders.

Therefore, in preparation of the case in which the number of Directors who are Audit and

Supervisory Committee members falls below the number legally required, the Company asks

shareholders to elect one (1) substitute Director who shall be member of the Audit and

Supervisory Committee in advance.

For the purpose of selecting Candidate for Substitute Director who is member of the

Audit and Supervisory Committee, the Nomination and Remuneration Committee, majority of

which consists of Independent Directors and of which the Chairman is an Independent External

Director so as to enhance transparency and objectivity, was referred to and the Board of

Directors decided Candidate for Director upon consideration of the recommendation of the

Nomination and Remuneration Committee.

The Audit and Supervisory Committee has given consent to this proposal.

The following is candidate for substitute Director who shall be a member of the Audit

and Supervisory Committee:

29

Name






Number of shares of

the Company held)



Hitoshi Kanamori

Date of birth: August 1, 1954



Apr. 1984: Public Prosecutor of Tokyo District Public

Prosecutors Office Apr. 1985: Public Prosecutor of Yamagata District Public

Prosecutors Office Apr. 1988: Public Prosecutor of Niigata District Public

Prosecutors Office Apr. 1992: Registered Lawyer (Tokyo Bar Association) Feb. 1996: Director of the Board, Social Welfare

Corporation Musashinokai (to present) Apr. 2002: Trustee of the Association for International

Manpower Development of Medium and Small Enterprises, Japan (Currently International Manpower Development Organization, Japan)

June 2012: Substitute Corporate Auditor of the Company June 2016: Substitute Director who shall be a member of the

Audit and Supervisory Committee of the Company (to present)

Oct. 2018: Lawyer, Kanamori Law Office (to present) Mar. 2020: Representative Director, Chairman of the Board,

of International Manpower Development Organization, (full-time) (to present)

Apr. 2020: Director of the Board, Global Medical Exchange & Support Institution (to present)

[Important concurrent office of other organizations] Lawyer, Kanamori Law Office

Representative Director, Chairman of the Board, of

International Manpower Development Organization

【Reasons for nomination as a Candidate of External Substitute Director as a member of the

audit and supervisory committee】

Although Mr. Hitoshi Kanamori has no direct management experiences for the private

companies other than being external director and external corporate auditor, he holds

knowledges and abundant experiences as a lawyer. Since it is expected that he will contribute to

the enhancement of audit and supervision of the Board of Directors by virtue of adequate and

due guidance and advice as legal profession, the Company asks shareholders to elect him as

External Substitute Director as a member of the Audit and Supervisory Committee. He is

scheduled to be notified to Tokyo Stock Exchange, Inc. as an independent officer when

assigned for External Director who is a member of the Audit and Supervisory Committee.

【Special Interested Relationship between the candidate and the Company】

There is no special interested relationship between Mr. Kanamori and the Company.

Substitute External Director who is a

member of the Audit and


30


When his election is approved, pursuant to Article 427, Paragraph 1 of the Companies Act, the

Company is scheduled to enter into a liability limit agreement limiting compensation liability

provided for in Article 423, Paragraph 1 of the Companies Act with him.

Furthermore, the limited amount of compensation liability is the minimum liability limit

provided for in laws and ordinances.

-End-

Documents

ISIN: JP3218900003 SEDOL: 6173694 JP...ISIN: JP3218900003 SEDOL: 6173694 JP May 26, 2020 To: Shareholders Notice of Convocation of the 41st Ordinary General Meeting of Shareholders